All About Income Tax Rules 2010-11

Indian government wants to implement DTC (Direct Tax Code) as soon as possible, so this was the first step to move forward to DTC in this...

Indian government wants to implement DTC (Direct Tax Code) as soon as possible, so this was the first step to move forward to DTC in this annual; budget. In this budget the basic exemption limit retained as 160000,190000 and 240000. But the slab of 160000-300000 where tax was 10% was widens to 500000. Whereas the 20% slab which was on 300000 to 500000 is put on 5 lakhs to 8 lakhs. So the person who has the income of 5 lakhs will get the benefit of Rs. 20600. Whereas the maximum benefit is Rs. 51500, which is for having the income exceeds 800000.

Because of consumer inflation index rising at 14.97%, this income tax slabs somehow leave some cash in the hands of individuals.

The New income tax slabs are as under.

1- In the case of male individual who is less than 65 years of age during the previous year.

Income Upto Rs. 160000 Nil

Rs. 160001 to 500000 10%

Rs. 500001 to 800000 20%

Above 800000 30%

2- In case of individual Woman less than 65 years of age.

Income Upto Rs. 190000 Nil

Rs. 190001 to 500000 10%

Rs. 500001 to 800000 20%

Above 800000 30%

3- In case of individual who is more than 65 years of age (Senior Citizen)

Income Upto Rs. 240000 Nil

Rs. 240001 to 500000 10%

Rs. 500001 to 800000 20%

Above 800000 30%

4- Cess rates are same as 3% on total txable amount.

Moreover, the additional benefits of Section 80C has also increased to 20000 which was earlier 1 lakh increased to 1.20 lakh rupees. But this benefit will only be entertained who invest in infrastructure bonds, under Section 80CCF a new section.

Tax Rates:-

1- Corporate and partnership firms are taxed at the rate of 30% as earlier.

2- Surcharge on domestic companies reduced to 7.5% which was earlier 10%.

3- Minimum Alternate Tax (MAT) rates are increased to 18% of book profits to 15%.

Charitable Purpose:-

Trade or business in relation for advancement of general public utility was not considered as charitable purposes earlier.

In this budget it purposes that receipts from such activities will be considered as charitable purposes so long if total receipts from these activities do not exceed Rupees 10 Lakhs in the previous year. EFFECTIVE ASSESSMENT YEAR 2009-10.

TECHNICAL service of NRIs

Income shall be deemed to accrue in India to non-resident, irrespective of the place of rendering such services.